Prime Minister Mostafa Madbouly has revoked a COVID-era discount on electricity prices for factories in a move expected to save 4 to 5 billion Egyptian pounds (around $80 to $100 million) annually, according to a cabinet source.
The decision, reviewed by Al Manassa, cancels the 10-piastre per kilowatt-hour reduction previously granted to industrial facilities under decree No. 781 of 2020. The measure was originally introduced as part of an emergency support package for manufacturers during the pandemic.
A government source familiar with electricity pricing policy, speaking on condition of anonymity, told Al Manassa that the move aligns with Egypt’s broader plan to phase out subsidies and transition toward full cost recovery for energy.
The plan, approved earlier by the cabinet, involves gradually increasing electricity rates for industrial users until they reflect actual production costs.
“The increase will range from 10 to 15 piastres per kilowatt-hour, depending on the type of industrial activity and consumption levels,” the source said. However, they noted that energy-intensive sectors such as steel and cement will still receive partial support to mitigate the impact on local prices. The exact form of this support has not yet been specified.
The rollback of the discount also reflects Egypt’s commitments under its loan agreement with the IMF, which requires structural reforms including liberalization of the energy sector.
In tandem, the Ministry of Electricity is working with the Ministry of Finance to develop incentives for factories that adopt energy-saving practices or switch to renewable power sources, the source added.
Egypt’s electricity generation relies heavily on natural gas and mazut (a type of fuel oil). Recent surges in import costs have added pressure to the national budget.
From January to mid-June 2025, Egypt spent approximately “$3 billion” on gas and mazut imports for power stations, up from “$2.2 billion” for all of 2024, a senior finance ministry official told Al Manassa.
The country is facing mounting challenges in meeting its energy needs, especially as natural gas import bills soared to “$1.73 billion” in the first quarter of 2025 alone—a sharp increase from “$696 million” in the same period last year, according to a previous Al Manassa report.
